26 May A Fun Way to Trade QQQ
A Fun Way to Trade QQQ
May 26, 2023
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You know what’s fun?
Winning trades.
You know what’s not fun?
Drawdowns.
(Or dollar cost averaging into an index fund in 2022.)
Question: What would you rather trade?
- A system that makes 100% profit over the long haul but has huge drawdowns and wins 35% of the time?
- A system that makes 50% profit over the long haul but has super low drawdowns and wins 75% of the time?
What’s the best workout plan? The one you’ll happily do every day.
What’s the best diet? The one you’ll happily eat every day.
What’s the best grip on your forehand? The one that you’ll happily hit every day.
The truth is: the best numbers are not always the best.
Many people get stuck on that. And it hurts them.
So, the answer to our question for many people probably should be #2. Because #2 is the one they’ll happily trade every day.
With that in mind, here’s a “fun” way to trade QQQ (the Nasdaq 100 ETF).
FUN QQQ RSI SYSTEM
- Chart: Daily
- RSI: 2 Length, Oversold 10/Overbought 73
- Filter:Â 100 SMA
- Long Only Entry: Price is above the 100 SMA and closes into Oversold first. Enter at Open of the next bar after price then closes up above Oversold.
Here are some recent trades:
Hmm, those all seem to be winning trades.
And here’s the Curve since 1999 (trading $10k of stock each time):
And here’s the Report:
It doesn’t make a million dollars but it has a close-to-close drawdown of...5%.
That’s a little lower than the max buy-and-hold drawdown of 83%:
There’s nothing wrong with having fun.
And there’s nothing wrong with avoiding drawdown.
Talk to you soon.
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Disclaimer:
It should not be assumed that the methods, techniques, or indicators presented in these products will be profitable or that they will not result in losses. Past results are not necessarily indicative of future results. Examples presented on these sites are for educational purposes only. These set-ups are not solicitations of any order to buy or sell. The authors, the publisher, and all affiliates assume no responsibility for your trading results. There is a high degree of risk in trading.
HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN INHERENT LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT ACTUALLY BEEN EXECUTED, THE RESULTS MAY HAVE UNDER- OR OVER-COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN.